Closing Bell: Sensex, Nifty flat amid volatility; bank, metals shine, auto, FMCG drag

Indian benchmark indices failed to hold on record levels and ended with marginal losses in the volatile session on April 9. At close, the Sensex was down 58.80 points or 0.08 percent at 74,683.70, and the Nifty was down 24.50 points or 0.11 percent at 22,641.80.

We wrap up today's edition of the Moneycontrol live market blog, and will be back tomorrow morning with all the latest updates and alerts. Please visit https://www.moneycontrol.com/markets/global-indices for all the global market action.

Nifty opened gap up today and witnessed selling pressure during the second half of the trading session which resulted into a marginal negative close for the index. On the daily charts we can observe that the Nifty has faced resistance at the upper end of the channel placed around 22740 – 22770. The hourly momentum indicator has triggered a negative crossover which is sign of loss of momentum. Thus, we can expect some consolidation though the overall trend is still positive, and we expect the dips towards 22600 – 22580 to be bought into.

Bank Nifty also witnessed selling pressure during the second half though it managed to close the day in the green. Overall, trend remains positive and dips towards support zone 48550 – 48500 should be used as a buying opportunity. Overall, the immediate upside / hurdle is placed at 49250 – 49300

Sensex & Nifty scaled new lifetime highs on the auspicious day of Gudi Padwa, but markets erased all its gains to end flat with a negative bias on select profit taking. While fundamentals continue to be strong, stretched valuations will allow investors to book profit at regular intervals. Investors would still be mindful of rising crude prices and US Fed’s inability to cut rates amid stubborn inflation, which could fuel uncertainty going ahead.

The Indian market reached a fresh intraday peak before seeing profit-booking at higher levels in anticipation of tomorrow's key US inflation data, which carries weight in determining future rate cuts by the US Fed. Concerns have emerged amidst recent better-than-anticipated US employment and manufacturing data, suggesting a potential shift in expectations regarding rate cuts this year. Moreover, escalating geopolitical tensions in the Middle East, alongside supply concerns, have propelled crude prices upward, impacting overall market sentiment. In the near term, the focus will shift to Q4 earnings, which will kick off this weekend.

Nifty opened higher but struggled to withstand the selling pressure at elevated levels. On the hourly chart, the RSI (14) indicates bearish divergence, signaling a potential shift in price momentum towards the downside. Immediate support is observed at 22,600; a decisive drop below this level could drive the index towards 22,400. Conversely, resistance is evident at 22,770 on the higher end.

Nifty50 began the day at another record level of 22,700 but failed to keep the strong momentum going and remained sideways in the morning trade. Profit booking in the 2nd half of the trading session pulled the Index lower to settle the day at 22,642.75 with a minuscule loss of 23.55 points.

With gains of more than 1%, the metal sector was the star performer while the realty segment extended its journey towards the north, and on the flip side, Media and PSU Banks were added to the list of underperformers.

Divergence was seen in the broader market performance where Smallcaps managed to end in the green while Midcaps marginally underperformed. On the daily timeframe, the Index has made a bearish candle.

Still, the overall uptrend is intact and correction if any, will provide better opportunities to enter at the lower levels. A level of 22,530 offers strong support while immediate resistance is placed at 22,780.

In the fourth quarter, the anticipated corporate earnings have been a driving force behind the recent market momentum. Despite notable increases in the prices of gold, crude oil, and metals, investors are witnessing an upward trend in equity markets, and there are expectations of a Federal Reserve rate cut. Investors may consider locking in partial profits while keeping a hold approach.

Government policies and reforms have played a crucial role in fostering a stable environment conducive to market growth. Measures aimed at stimulating the economy, coupled with a focus on digitalization and infrastructure development, have attracted substantial investments. The growing involvement of retail investors, combined with sustained interest from foreign institutional investors, highlights the widespread confidence in India's growth story.

Indian benchmark indices failed to hold on record levels and ended with marginal losses in the volatile session on April 9.

At close, the Sensex was down 58.80 points or 0.08 percent at 74,683.70, and the Nifty was down 24.50 points or 0.11 percent at 22,641.80. About 1434 shares advanced, 2269 shares declined, and 100 shares unchanged.

Apollo Hospitals, Hindalco Industries, ICICI Bank, Infosys and Bajaj Finserv were among major gainers, while losers were Titan Company, Hero MotoCorp, Coal India, Reliance Industreis and Asian Paints.

On the sectoral front, media, auto, capital goods, FMCG down 0.5-1 percent, while metal and realty up 0.5 percent each.

BSE Midcap and Smallcap indices ended on negative note.

-Outperform call, target Rs 1,028 per share
-JLR Q4FY24 showed modest beat on wholesale
-EBITDA margin could be flattish QoQ given a 100 bps decline in share of premium models and higher incentive spend
-EBIT margin should improve QoQ
-Company has not shared JLR's Q4 estimated free cash flow

-Sell call, target Rs 270 per share
-Company signed an MoU with Hyundai-Kia to supply LFP batteries for EVs
-Expect demand growth to outpace capacity addition in the near-term
-Company is well-positioned to benefit, given its partnership with SVOLT
-Company has first-mover advantage in the domestic market
-Higher capex intensity & commoditised nature of business may weigh on return ratios
-Sell stays on expensive valuations

-Coal Ministry wants to get 20 new mines operational by the end of the year
-Coal Ministry wants to expand coal output by 100 mt via these 20 mines
10 of these 20 mines were allotted to Coal India

Sensex Today | BSE Oil & Gas index down 0.4 percent dragged by Reliance Industries, BPCL, HPCL

-Initiate buy on 360 One, target Rs 900 per share
-Initiate buy on Nuvama Wealth, target Rs 6,000 per share
-Believe Indian wealth managers are well-placed
-Wealth managers well placed to ride on economic growth & financialisation of savings
-Leading players will benefit from strong inflows
-Operational efficiencies to deliver 20-22 percent profit CAGR over FY24-27
-Rise in share of trail fees, 70-75 percent by FY27 improves earning visibility
-Rise in share of trail fees support valuation re-rating

India may divert more sugar to produce ethanol: Bloomberg

-Buy call, target Rs 4,300 per share
-Pricing going up may be vital for sector’s financial health
-FY24: sector in red while company is operating at healthy spreads
-Profitability of company can potentially breach past peaks & sustain for long before normalizing down

Sensex Today | Market at 3 PM

The Sensex was down 37.01 points or 0.05 percent at 74,705.49, and the Nifty was down 14.20 points or 0.06 percent at 22,652.10. About 1272 shares advanced, 2028 shares declined, and 75 shares unchanged.

Industry wide BO collections increased 3% YoY to Rs 19.3 billion in 4QFY24E. Given modest growth in collections, we expect PVR-Inox to report footfalls of 33 mn (~23.4% occupancy) resulting in a break-even at operating level (pre-IND AS EBITDA).

On broadcasting side, ZEEL’s performance is likely to be impacted by continued weakness in ad-environment and sharp moderation in movie business while operating margin will be under pressure led by costs associated with ILT20.

We expect revenues to decline 7.6% YoY to Rs19.5bn with an EBITDA margin of 7.2%.

Sensex Today | BSE Bank index up 0.3 percent led by ICICI Bank, Federal Bank, Axis Bank

-Overweight call, target at Rs 1,013 per share
-JLR reported wholesale volume growth of 16 percent YoY in Q4FY24, up 9 percent QoQ
-Mix was weaker as premium models share was at 61 percent versus 62 percent in Q3FY24
-Mix was weaker as China share down to 12 percent of sales versus 15 percent in Q3
-Retail sales grew 11 percent YoY, driven by North America & UK
-Europe saw a 2 percent YoY decline and China saw a 9 percent YoY decline
-Expect an EBIT margin Of 9.1 percent for JLR in Q4FY24 against 8.8 percent (QoQ)

Minority shareholders of Jindal Poly Films have filed a class action suit with the National Company Law Tribunal (NCLT) alleging the siphoning off of funds to promoters, resulting in a staggering loss of approximately Rs2,000 crore to the company, CNBC reported.

Sensex Today | Market at 2 PM

The Sensex was down 29.20 points or 0.04 percent at 74,713.30, and the Nifty was down 12.00 points or 0.05 percent at 22,654.30. About 1280 shares advanced, 1989 shares declined, and 76 shares unchanged.

-Buy call, target at Rs 1,057 per share
-JLR Q4 retail volumes up 11 percent YoY; EBIT margin estimate at 9 percent
-JLR reports QoQ and YoY increase in retail & wholesale volumes for Q4FY24
-An estimate FCF of GBP 600-700 million should bring JLR’s net debt to <GBP 1 billion in Q4FY24

Sensex Today | BSE Capital Goods index down 0.6 percent dragged by Bharat Forge, Elgi Equipments, Suzlon Energy

Sensex Today | Nifty Media index down 1 percent dragged by Network 18 Media & Investments, Sun TV Network, Dish TV

-Buy call, target at Rs 1,120 per share
-Commissioning of DFC to drive containerised cargo movement & company will be key beneficiary
-Expect blended volumes to report 10 percent CAGR during FY24-26
-Stock trades at 16.9x FY26 EV/EBITDA

Polycab India: buy call, target raised to Rs 5,870 per share
KEI Industries: buy call, target raised to Rs 3,850 per share
RR Kabel: buy call, target at Rs 1,800 per share
Expect strong volume backed mid-teens YoY revenue growth
Expect strong profit growth for covered stocks
C&W sector continues to see strong growth tailwinds across end-markets
Exports are also a solid opportunity

On the economic growth front, expectations of a healthy yet much slower growth in FY25E led by cyclical headwinds such as relatively weak exports, tighter lending standards, and agriculture sector performance. Markets are expected to be driven by global rate cut expectations in the second half of the year and massive net Foreign portfolio Investment (FPI) flows in the debt market, however still expected to experience some volatility.

Sensex Today | BSE Metal index up 0.6 percent led by Vedanta, SAIL, Hindalco Industries

-Buy call, target at Rs 2,600 per share
-Company highlighted Rs 1,000 crore gross revenue milestone for Birla pivot
-In FY22, company said they targeted an investment of Rs 2,000 crore into building this unit
-Closest competitor, infra.market has grown exponentially in the past 3 years
-Competitor infra.market saw a positive profit, last valued at USD 2.5 bn
-Company targets to scale segment gross revenue to USD 1 billlion by FY27
-Awaiting sustained scale up, currently not valuing the business separately in SOTP

The Insurance Regulatory and Development Authority of India (IRDAI) has imposed a penalty of Rs 20 lakh on Edelweiss Tokio Life Insurance Company, a subsidiary of Edelweiss Financial Services, for change in its shareholding pattern, without their prior approval.

Sensex Today | Market at 1 PM

The Sensex was up 111.74 points or 0.15 percent at 74,854.24, and the Nifty was up 24.00 points or 0.11 percent at 22,690.30. About 1554 shares advanced, 1685 shares declined, and 81 shares unchanged.

Sterlite Technologies has opened its qualified institutions placement (QIP) issue on April 8. The floor price for the issue has been fixed at Rs 119 per share. Further, the board of the directors of the company will be meeting on April 12, to approve the issue price for QIP.

Sensex Today | Nifty FMCG index down 0.4 percent dragged by Colgate Palmolive, Marico, Varun Beverages

Dixon Technologies (India) has entered into a Share Purchase Agreement with Ismartu Singapore, Transsion Technology, 5A advisors LLP and Ismartu India, for acquisition of 50.1% stake in Ismartu India, the electronics & mobile devices manufacturer. The transaction will be subject to the approval of Competition Commission of India.

Gold prices rose on Tuesday, hovering near a record peak hit in the previous session, supported by firm central bank buying, while investors watched out for the Federal Reserve's policy meeting minutes and U.S. inflation data for fresh signals.

Spot gold was up 0.3% at $2,345.09 per ounce, as of 0621 GMT, after hitting a record high of $2,353.79 on Monday. U.S. gold futures gained 0.5% to $2,363.50.

Oil prices rose on Tuesday after hopes diminished that negotiations between Israel and Hamas would lead to a ceasefire in Gaza amid concerns the lingering conflict could potentially disrupt supply from the key Middle East producing region.

Brent crude futures rose 14 cents to $90.52 a barrel by 0610 GMT. U.S. West Texas Intermediate (WTI) crude was 10 cents higher at $86.53.

Have been a big bull on India
With China slowing down, India to see momentum in manufacturing and exports
India is becoming a logical choice for most global investors

Strides Pharma Science announced that its step‐down wholly owned subsidiary, Strides Pharma Global Pte. Limited, Singapore, has received approval for Fluoxetine Tabs 10 mg and 20 mg, from the United States Food & Drug Administration (USFDA).

-Overweight call, target Rs 3,046 per share
-Company has re-rated 10 percent YTD, 35 percent in last one year
-Company now trades at 24x P/E and 10x EV/EBIDTA on FY26 estimate
-Potential for re-rating across verticals – new energy, refining, chemicals and telecom
-Net debt and slower capex intensity to be supportive of valuations in FY25
-It’s all about re-rating in this part of value creation journey as net debt declines

-Overweight call, target raised to Rs 14,322 per share
-Global slowdown in EVs shows that powertrain strategy which company has is best to navigate landscape
-Hybrids are seen as an attractive bridge in the EV transition globally
-Hybrid takeoff in India has been slow but this could change
-Key risk - market gets highly competitive in SUV segment while FTBs do not return
-Market share losses cause de-rating

Foreign investor Citigroup Global Markets Mauritius has purchased 1,76,68,000 equity shares (0.67% of paid up equity) in South Indian Bank at an average price of Rs 28.78 per share, which amounted to Rs 50.85 crore. Copthall Mauritius Investment was the seller in the deal.

Despite 100% OFS, Bharti Hexacom IPO received solid response on the last day of its issue biding wherein QIB (48.57x) and NII (10.51x) investors looked more aggressive to grab midcap telecommunication growth story followed by muted retail investors interest who bided only 2.81 times to the allotted quota. Overall it got oversubscribed by 29.87x.

While considering the current optimistic uptrend in the markets, along with healthy subscription demand from all sets of investors, we expect Bharti Hexacom to list a healthy 10-12% higher to its issue price of Rs 570.

Healthy listing around 10-12% is justified due to a great opportunity for long term investors to hold mid-cap telecommunications solutions providers and to play long term India’s telecom structural ARPU growth story. Furthermore, Bharti Hexacom’s anchor book showcases top global investors such as Capital Group, Fidelity, Blackrock, and ADIA participating ahead of the opening of the IPO which give all other investors more comforts to block money for long term.

On valuation parse at the upper band of Rs 570, the issue was asking a Market cap of Rs. 28500/- cr and based on annualized FY 2024 earnings, the company was asking a P/E of 76x which seems the offer was fully priced in the near term growth triggers when compared to its peers and even its parent Bharti Airtel is available ~63x. Investors should also look at IPO offers that come with 100% OFS i.e Rs.4275/- cr issue which is an area of concern for new investors. But the relationship between Bharti Hexacom and Airtel presents a compelling synergy, leveraging Airtel's brand strength, diverse service offerings and sustainability focus to drive sustained market growth. Hence, considering all the parameters we recommend allotted investors to “HOLD” the Bharti Hexacom Ltd for Long term perspective only while those investors who wish to add on the listing days can wait and watch the space post listing performance and accumulate on dips.

Foreign investor Citigroup Global Markets Mauritius has bought 66.97 lakh equity shares (equivalent to 1.11% of total paid up equity) in RBL Bank at an average price of Rs 255.4 per share via open market transactions, amounting to Rs 171.04 crore. Copthall Mauritius Investment was the seller in the deal.

NCL Industries' cement production grew by 4% year-on-year to 7.30 lakh MT and cement dispatches rose by 4% to 7.39 lakh MT for the quarter ended March FY24. Cement boards production increased by 17% to 21,976 MT and dispatches were up 5% at 21,651 MT during the same period.

India's consumer price inflation likely eased to a five-month low of 4.91% in March but was still above the Reserve Bank of India's 4% medium-term target as food price rises persist, according to economists polled by Reuters.

RBI Governor Shaktikanta Das said last week that food price volatility remains a concern. Food price rises have outpaced headline inflation for several months, affecting millions of poor households already heavily dependent on government food subsidies.

Consumer price inflation likely eased to 4.91% in March from February's 5.09%, an April 4-8 Reuters poll of 50 economists predicted. Forecasts for the data, which will be released on April 12, ranged from 4.57% to 5.35%.

Sula Vineyards has recorded 10 percent growth in net revenue for Q4 as well as FY24. Net revenue for March FY24 quarter stood at Rs 131.8 crore against Rs 120 crore in same period last year, while the full year revenue came in at Rs 608.6 crore against Rs 553.4 crore in previous year.

Sensex Today | Nifty Bank hits fresh record high of 48,940.35

UCO Bank has reported total business at Rs 4.50 lakh crore for the quarter ended March FY24, growing 9.62% over the same period last fiscal, with total advances increasing 15.92% YoY to Rs 1.87 lakh crore and deposit rising 5.53% to Rs 2.63 lakh crore during the same period.

On the auspicious occasion of Gudi Padwa, Nifty scaled a fresh all-time high at 22765 mark and Sensex breached the 75000 mark to touch a high of 75137. The main catalyst behind the current uptrend is the hope of a stronger than expected Q4 corporate earnings which is fuelling the market momentum over the past one week. The uptick is equity markets is seen despite a strong momentum in gold, crude and metals, as more than a Fed rate cut expectations going ahead investors are pinning hopes on strong Q4 earnings.

We also assume that domestic growth in H1FY2025 is likely to remain strong on the back of an acceleration in consumption demand amid election-related spending. Hence, the markets are expected to perform well, with high focus on large-caps which are offering better safety margins in earnings as well as valuations.

Analysts maintain 'Sell' rating due to expensive valuations. They believe that higher capex intensity and commoditized nature of the business may weigh on return ratios, as seen with global battery players. However, they added that the company is well-positioned to benefit, given its partnership with SVOLT and first-mover advantage in the domestic market.

Around 6 lakh equity shares were exchanged at BSE and NSE on April 9 so far, compared to one-month average of 1 lakh shares, data suggested

Sensex Today | Market at 11 AM

The Sensex was up 319.63 points or 0.43 percent at 75,062.13, and the Nifty was up 80.50 points or 0.36 percent at 22,746.80. About 1837 shares advanced, 1268 shares declined, and 102 shares unchanged.

- The CD ratio saw an uptick of 38 bps compared to previous fortnight and reached at 80.3 percent, marking a decade high, primarily driven by HDFC merger
- Credit increased by 20.2 percent YoY to reach Rs 164.3 lakh crore, for the fortnight ending March 22, 2024, primarily being driven by demand for personal loans
- Deposits grew by 13.5% YoY for the fortnight (including the merger impact) and reached Rs 204.8 lakh crore as on March 22, 2024